How do you know if you are a beneficiary of a Trust, and how much you are entitled to receive? The only way to know is to review the terms of the Trust document. However, that can be a problem at times when a parent refuses to share Trust document with you. Or worse yet, a brother or sister of yours has the document, but refuses to give you a copy. What are your rights and how should you proceed in cases like these? The answer might surprise you.
If both Trust creators (also called “Settlors”) are still alive, the beneficiaries are not generally entitled to a copy of the Trust document yet. While the Settlors are living, they still have the right to change (amend) the Trust or revoke (terminate) it. while a Trust is revocable, only the person (or people) holding the power to revoke are entitled to beneficiary rights, which includes obtaining a copy of the Trust document. That changes, however, when a Settlor dies and the Trust, or a portion of the Trust, becomes irrevocable.
There are exceptions, of course. Sometimes Trusts are set up as irrevocable from the outset. Irrevocable Trusts are not as common as revocable Trusts, but they can be used for more advanced estate planning strategies. In addition, some Trusts are created so a portion of the Trust becomes irrevocable upon the death of the first spouse, while the remaining spouse (often called the “surviving spouse”) retains the right to amend, restate or revoke their portion of the Trust during their lifetime. This type of Trust (often called an A/B Trust) is most common in blended families where the Settlors have children from past marriages or relationships.
So how do you know if the Trust is revocable? You don’t unless you review the terms of the Trust. But in most cases if both of your parents are still alive, then the Trust is likely revocable. Your parents (or a parent) can choose to provide you with a copy of the trust if they like, but you do not have a legal right to a copy just yet. When one parent dies, then you might be entitled to see the irrevocable portions of the Trust, if there are any. Keep in mind, that some Trusts remain fully revocable even after the first spouse dies. Once both parents are deceased, then you most likely have an irrevocable Trust. You then are entitled to receive a copy of it from the Trustee.
The Trustee is required to send the heirs and beneficiaries copies of the Trust, along with a notification that states the interested parties have 120 days to contest or challenge the validity of the Trust. While every Trust is different, Trust beneficiaries can generally assume they will receive a copy of the Trust terms within 30 to 60 days following the death of the Settlor, or the last Settlor. If the beneficiaries still do not receive the Trust, the best course of action would be to contact a licensed attorney who specializes in Trust and Estate law and petition the court to force the Trustee to comply with Trust law.
It’s not always easy obtaining a copy of the Trust, but it is critical to do so. Without the Trust document, you cannot know what your legal rights are to the Trust estate.